Refer Case Study 1 As part of Mr. Sung Wong's team from TTC, ANALYZE COAL's operations using McKinsey 7S framework.

The company's cost leadership strategy was misaligned with the government's regulatory requirements, ultimately leading to the disruption of operations in April 2026. The McKinsey 7S Framework comprises both hard and soft elements that provide a comprehensive framework for analysing an organisation's effectiveness. These seven elements are interdependent, and any misalignment among them can adversely affect organisational performance. The framework can therefore help the consultants identify the key gaps that contributed to the crisis and recommend appropriate corrective measures. Elements of the McKinsey 7s Framework Strategy: COAL follows a cost leadership strategy with a strong emphasis on enabling customers to reach their destinations on time, as reflected in its tagline, "Punctuality, Prioritized, Price Downsized." Since the airline operates in a highly competitive market, ticket prices are largely market-driven, requiring COAL to engage in intense price competition with its rivals. To maximise revenue, the company sought to minimise aircraft turnaround time and maximise aircraft utilisation, thereby increasing flying hours and revenue-generating capacity. This enabled the airline to maintain punctual operations by ensuring that aircraft spent the least possible time on the ground. Simultaneously, profitability was pursued through aggressive cost reduction measures, particularly by maintaining a lean workforce. Although this strategy improved operational efficiency under normal circumstances, it failed to build resilience into the organisation. The absence of adequate operational buffers and contingency planning ultimately resulted in the operational crisis of April 2026. Structure: COAL followed a highly centralised organisational structure in which strategic and tactical decisions were made at the headquarters. The objective was to ensure uniformity in policy implementation across the organisation, while lower-level management was primarily responsible for execution. Operational feedback from regional offices had little influence on decision-making. Such an autocratic and rigid organisational structure reduced the agility required to respond effectively to business disruptions. Since regional management was not empowered to take timely decisions, the organisation's ability to contain the crisis was significantly restricted. COAL should decentralise selected tactical and operational decisions, particularly those relating to day-to-day operations. Cross-functional teams, cross-location collaboration, and participative management would enhance organisational agility and improve responsiveness during disruptions. Systems: COAL's hub-and-spoke operating model created a highly interconnected flight network, whereby disruptions in one sector rapidly affected multiple connecting flights. However, the company's human resource systems, particularly crew and pilot rostering, were not aligned with the regulatory expectations. The existing rostering system provided only five hours of rest compared with the recommended minimum of eight hours. Despite repeated indications that these guidelines would become mandatory, management chose not to strengthen its workforce due to concerns over increased operating costs. Once the regulations became mandatory in April 2026, the existing systems failed to adapt, leading to widespread flight cancellations, operational disruptions, regulatory penalties, and substantial financial losses. This demonstrates that systems designed solely to maximise efficiency and minimise costs may ultimately undermine long-term profitability. Shared Values: COAL's shared values strongly emphasised customer satisfaction through punctuality and maximising shareholder returns. However, these objectives were pursued at the expense of employee welfare and operational resilience. The company's values were also inconsistent with the government's increasing emphasis on aviation safety. Ironically, the pursuit of punctuality exposed passengers to greater operational risks by placing excessive pressure on crew members. Had customers been aware that safety standards were being compromised, they may have preferred not to travel with the airline. COAL should realign its shared values by fostering a culture that prioritises safety, employee well-being, regulatory compliance, and long-term sustainability alongside customer satisfaction and profitability. Building trust among employees is essential before rebuilding confidence among customers and other external stakeholders. Style: COAL adopted an autocratic and bureaucratic leadership style that largely ignored employee feedback and regulatory concerns. Such a leadership approach created a rigid organisational culture with limited flexibility and employee involvement. Following the crisis, the organisation should adopt a more participative, inclusive, and empowering leadership style that encourages employee engagement, innovation, collaboration, and open communication. Such a leadership approach will improve employee morale and strengthen organisational resilience. Staff: Managing nearly 45% of India's domestic aviation market with a lean workforce, combined with a stressful work environment, limited incentives, and inadequate opportunities for learning and career development, resulted in high employee turnover. This should have served as an early warning indicator of underlying organisational issues. Following the regulatory changes, COAL must strengthen its workforce to ensure seamless operations. Employees are the driving force in customer-facing, high-velocity industries such as aviation. Accordingly, improving employee morale through competitive compensation, incentives, career development opportunities, and a supportive work environment will contribute significantly to sustainable business growth. Skills: Management relied primarily on on-the-job learning rather than structured employee training and development. This reflected the company's continued emphasis on short-term cost reduction. Insufficient investment in employee development can create skill gaps, increase operational inefficiencies, and adversely affect service quality and safety. Moreover, inadequate training opportunities contribute to higher employee turnover, thereby undermining long-term business sustainability and profitability. Continuous investment in employee capabilities is therefore essential for maintaining operational excellence. Overall An analysis of COAL using the McKinsey 7S Framework reveals significant misalignment between the company's strategy, structure, systems, and shared values and the external business environment. The organisation's excessive focus on cost leadership compromised regulatory compliance, employee welfare, and operational resilience. The company should redefine its strategy by placing equal emphasis on passenger safety, regulatory compliance, employee well-being, and sustainable growth. Its operational systems, particularly crew rostering, should proactively comply with evolving regulatory expectations rather than merely meeting minimum legal requirements. Instead of pursuing excessively lean operations, COAL should build appropriate operational buffers to enhance resilience against unforeseen disruptions. The crisis clearly demonstrated the paradox of attempting to achieve exceptional punctuality through an overworked and understaffed workforce while compromising safety standards. Such an approach was unsustainable and ultimately resulted in severe operational, financial, and reputational damage. The disruption in April 2026 significantly eroded customer confidence, shareholder value, and brand reputation. The recovery strategy should therefore focus on decentralising decision-making, empowering regional management, strengthening regulatory compliance, building operational resilience, investing in human capital, and fostering an organisational culture that promotes collaboration, innovation, safety, and employee engagement. Transparent communication with regulators, investors, customers, and the public will also be essential to rebuilding trust and restoring COAL's market leadership.